The Central Bank of Nigeria (CBN) has announced significant updates to the regulatory guidelines for Bureau De Change (BDC) operators, aimed at streamlining operations and enhancing financial accessibility.
This follows extensive consultations with stakeholders.
In a circular released on Wednesday and uploaded to the bank’s website, Haruna Mustafa, Director of the Financial Policy and Regulation Department at CBN.
Outlined the changes:
The mandatory caution deposit of N200 million for tier-1 BDC licence holders and N50 million for tier-2 licence holders has been removed.
The non-refundable annual licence renewal fees of N5 million for tier-1 BDCs and N1 million for tier-2 BDCs have also been waived.
These adjustments are intended to facilitate smoother BDC operations.
Mustafa noted, “These reforms are designed to streamline BDC operations and enhance financial accessibility.”
The circular specified that existing BDCs must re-apply for new licences based on their preferred tier or licence category as outlined in the updated guidelines.
New applicants must meet the specified conditions for their chosen BDC category.
Additionally, existing BDCs are required to meet the minimum capital requirements for their selected licence category within six months from the effective date of the guidelines.
Furthermore, the permissible activities for BDCs have been revised to ensure alignment with market needs and regulatory standards.
Mustafa emphasized that BDCs must adhere to corporate governance requirements and anti-money laundering, counter-terrorism financing, and counter-proliferation financing provisions.
The CBN also announced that the receipt and processing of licence applications will begin from the effective date of the guidelines.
Interested applicants should submit the necessary information electronically to bdclicense@cbn.gov.ng, including the name of the promoter, name of the proposed BDC, email address of the promoter, and phone number of the promoter.
These new guidelines replace the Revised Operational Guidelines for Bureau De Change in Nigeria issued in November 2015, along with all related circulars and directives.
The Regulatory and Supervisory Guidelines for BDC Operations will take effect from June 3, 2024.
The circular partly read, “As part of reforms to re-position the Bureau De Change (BDC) sub-sector to play its envisioned role in the foreign exchange market in Nigeria, the Central Bank of Nigeria (CBN) issued the Draft Operational Guidelines for BDC Operations in Nigeria in February 2024, for stakeholder comments/inputs.
“Following the conclusion of the stakeholder consultations and in the exercise of the powers conferred on it by Section 56 of the Banks and Other Financial Institutions Act (BOFIA) 2020, the CBN hereby issues the attached Regulatory and Supervisory Guidelines for Bureau De Change Operations in Nigeria 2024 for compliance by all operators and promoters of proposed BDCs in Nigeria.
“The guidelines, amongst others, introduce new licensing requirements and categories of BDCs as well as revise the permissible activities, financial requirements, corporate governance requirements and AML/CFT/CPF provisions for BDCs.
“All existing BDCs shall re-apply for a new license according to any of the Tiers or license categories of their choice as provided in the Guidelines.”
